Clairvest: Without help, casino plan 'dead'

Wednesday, June 18, 2014 - Updated: 10:09 AM

By NICOLE ANTONUCCI

nicole.antonucci@recordernews.com

Plans for a casino at Thruway Exit 27 could flat-line before the state Gaming Commission has a chance to consider granting it a license.

Before Clairvest Group Inc. will submit its application to the state, the developer says the Gaming Commission will have to consider halving the $50 million licensing fee and extending the application deadline.

If neither of these requests are granted by the state, the casino project is dead.

"There will not be a submission from the county, from us," Clairvest Group CEO Jeffrey Parr said Tuesday. "There might be somebody else, but it won't be us."

Lee Park, a spokesman for the Gaming Commission, would not comment on whether special requests will be considered.

"The RFA and the siting process speak for themselves," he said.

But Parr is asking the state to consider the economy of Montgomery County as it did in other regions in the state, and allow him to defer $25 million of the licensing fee. The state would be reimbursed that money after the site begins generating revenue, he said.

"The economic model does not work," Parr said. "In other jurisdictions of the state, there were lower tax rates on gross revenue, and they have lower licensing fees to reflect that their gross revenue would be lower in those communities."

The June 30 deadline, which is just two weeks away, is also posing a problem for the Clairvest development team. Parr is seeking a 60-day extension.

Parr said his company has not made these requests before, but other companies have.

"There have been many processes that are run by states and provinces that have changes made to the terms once the state learns the economics of the process," he said. "So, it's not unusual when the process gets changed, or terms get changed. Have we formally asked in the past, however? No. Have others? Absolutely."

Parr said requests similar to the two his group is making, have been both accepted and rejected by others in the past.

"Sometimes the governing body will say 'We'll take it under advisement' and then a change will occur and it may not be exactly what was requested but it will obviously be a result of the request," he said. "You'll be able to put the dots together."

Clairvest's investment adviser Peter Marcil, of Bentley Associates in New York City, confirmed that if the group's requests are not granted by the state then the application will not be submitted by Clairvest.

"I don't know what's going to happen," said Marcil, an Amsterdam native. "We just have to do our best and wait and see, it's all you can do."

Montgomery County Economic Development Director Kenneth Rose said the request does concern him but he understands why the developer is doing it.

"These are all up-front costs, and there is a return that has to be had," Rose said.

He added that the state's criteria to create a destination resort complete with a casino, hotel and amenities within two years presents a challenge to developers.

"Turning Stone Casino didn't become a destination within two years. It grew gradually, which is the course of a normal economic development project," Rose said. "The state is forcing you to throw your money at this thing and say 'Boom; here it is.' It doesn't work that way."

While the Montgomery County site would not make the same revenue as, perhaps, a casino closer to the heart of the Capital District, it doesn't mean the county will not be considered, Rose said. It comes down to revenues versus intent of the legislation, which was to create jobs and help struggling upstate communities.

"The casino would be more transformational here than it would be in the Capital District," Rose said.

Montgomery County Executive Matthew Ossenfort does not believe hope is lost.

"We are assessing our options should the requests not be made," Ossenfort said. "It is an ongoing conversation that we are having."

Ossenfort said he is still optimistic, adding that even if the application is submitted to the Gaming Commission, there is a chance it may not be approved for a license.

"I am just working to ensure that we are doing everything we can to advocate on behalf of this project and the people of this county," Ossenfort said. "Let the chips fall where they lay."